Financial review

The accompanying condensed financial statement represent the activities of the Chancery Offices of the Archdiocese of Kansas City in Kansas for fiscal 2009-2010. These statements do not include the activities of our many parishes, schools and other ministries that are governed by their own boards and report their financial information separately.

Financial statements of the Chancery Offices of the Archdiocese of Kansas City in Kansas are audited by the independent CPA firm of McGladrey & Pullen, LLP. This audit is conducted according to the General Accepted Accounting Principles in the United States. Their complete audit report of the financial statements for the years ended June 30, 2010 and 2009 is available on the Archdiocesan website, www.archkck.org. The condensed financial statements referenced above have not been audited by any independent public accountants. June 2010 and 2009 in this review relate to the Archdiocesan fiscal year ending June 30 of those respective years.

CONDENSED STATEMENT OF FINANCIAL POSITION

Total assets of the Chancery Offices as of June 30, 2010 were approximately $107 million compared with $105 million the previous year. Cash and investments increased about $2 million in the cur- rent year from the prior year. The majority of this is a reflection of the increase in the market value of our Cor Christi fund which has recovered a portion of the loss it suffered in the prior two years. The only other change noteworthy on the asset side is the decrease in loans receivable from $63 million in 2009 to $62 million in 2010. It was noted in prior years that the Archdiocese has been experiencing a rather significant building boom over the last several years including a number of new churches and expansions or remodeling of older facilities. The peak of borrowing happened during the fiscal year ended 2009 and we are now beginning to see significant repayments of those loans.

On the liability side, total liabilities remained almost unchanged at $59 million; however, there is a significant decrease in the usage of our lines of credit. Again, this was related to the building activity that was happening during 2009. You will note that lines of credit outstanding a year ago was $4 million and as of June 30, 2010, there is no money currently owed to banks under our lines of credit. Part of the reason for that offset in borrowing is the increase from $52 million to over $55 million in deposits hat come to us from parishes, schools, and other ministries which have excess funds. These additional deposits were used to finance the building activity and then more recently to help reduce the amount of our borrowing.

Total net assets increased from $46 million to $48 million at June 30, 2010. The majority of this change is a result of strengthening our reserves for the health and dental care plans which are administered by the Archdiocese.

CONDENSED STATEMENT OF ACTIVITIES

The condensed statement of activities shows the income and expenses relating to the various ministries and programs that are carried out through the Chancery offices. Total unrestricted revenue for the year 2010 was $28 million – which is an increase of approximately $7 million over the prior year. The single largest contributor to this was improvements in the stock market which manifested itself in a gain on our investments of over $4 million for the year ended 2010 compared to a loss in market value for the prior year of almost $2 million. In addition, our health and dental care premiums increased more than $1 million for the year ended June 30, 2010.

On the expense side of the ledger, for the most part, our various expense categories are relatively consistent from one year to the next. I would point out that Cor Christi distributions are about half of what they were in the prior year. Again, this is a reflection of the lower stock market returns which we have experienced over the last several years. It has required us to cut back significantly on the distributions from that fund. In addition, you will notice that Future Full of Hope distributions and parish rebates are also about half of what they were the prior year and this is a continuation of the pay down on the pledges for that campaign that we have been experiencing over the last several years. As of June 30, 2010 all of the pledges on that campaign have either been received or have been abandoned.

Total net assets increased approximately $2 million and the bulk of this was in the area of unrestricted funds. The largest increase in that area was the growth in our health and dental care reserves from the prior year. In addition, in the unrestricted funds, we experienced about a $500,000 increase almost exclusively due to increased pledges on the Archbishop’s Call to Share campaign.

CONCLUSION

The staff of the Archdiocese of Kansas City in Kansas is pleased to provide you with this brief review of our financial statements for the year ended June 30, 2010.

We would encourage those who have aninterest to review our entire financial picture as presented in our audit report which is available on the Archdiocesan website. The entire staffs of the Chancery offices, both religious and lay, continue to be committed to all of the principles of good stewardship in shepherding the resources that you make available to us.